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Monday, September 29, 2014

MANILA-Senate President Franklin M. Drilon today expressed readiness to recommend to the President the holding of special session in order to enact a number of economic measures which will improve business climate, boost investment and ensure the nation’s macroeconomic and fiscal sustainability.

“If we cannot make a substantial progress to our economic legislative agenda by March 2015, I am prepared to recommend to the President that we convene Congress to a special session in May and June 2015 to pursue our economic reform policies,” said Drilon, who was the guest speaker during the Management Association of the Philippines' General Membership Meeting today.

“The 2016 elections can wait. We have work to do,” he stressed.

Drilon told the business leaders that upon the resumption of session in October, the Senate will shift its focus on a comprehensive package of reforms that will improve the business and investment climate, apart from the enactment of the 2015 national budget and the proposed Bangsamoro Basic Law.

This reform package includes the proposed amendment of the Build Operate Transfer Law “to create a better enabling policy environment for Public-Private Partnership.”

“To attract foreign investment, we have set our sights on cultivating a business environment that allows foreign investors to engage in a wider array of financial activities, to comply with reasonable and expedient regulatory requirements, and subsequently earn fair and equitable return of their investments,” said Drilon.

The Senate leader assured business leaders that the Congress is looking into the looming power shortage in the summer of 2015. However, Drilon maintained that the request of the President to authorize him to contract additional generating power must not be done in haste and must be the “last resort”.

“Although there is a need for additional generating capacity, I believe that we must first explore other available solutions to the problem. We can implement various efficiency and conservation measures such as load curtailments (or demand response), an example of which is utilization of the existing Interruptible Load Program,” underscored Drilon.

He added that it is an opportune time “to establish a clear energy agenda and to address the growing concern over the perceived inability of the country’s power sector to keep up with the growing demand that is intricately linked to the Philippine economy’s immense economic growth.”

In addition, the Congress will also pass the Fair Competition Act to promote economic efficiency in trade, industry and commerce through the prohibition of anti-competitive agreements, abuse of dominant position, and anti-competitive mergers which distort and restrict competition.

“Having a competition law and policy in place will foster the competitive environment in our national economy. Competition spurs economic efficiency and innovation, and attracts investments, all of which lead to lower prices, higher quality of products and services, and more choices for consumers,” explained Drilon.

“Competition law and policy will ultimately bring about a dynamic, sustainable, inclusive economic growth and national progress,” he added.

After the Congress allowed the full entry of foreign banks in the country, Drilon said the Congress is seriously considering the amendment or repeal of provisions in existing laws limiting foreign equity in areas such as retail trade enterprise, contracts for the construction and repair of locally-funded public works, and rice and corn production, among others.

It also plans to amend the Cabotage law to allow foreign-registered vessels to engage in coastwise trade in the country. Drilon explained that the amendment is being proposed to open the market to competition, bring down transportation costs by sea, and enable the country to fully utilize the supply chains for products.

Also up for discussion in Congress are measures calling for a review of numerous fiscal and non-fiscal incentives and subsidies to foreign and domestic investors. Drilon noted that there are around 186 laws which provide numerous fiscal and non-fiscal incentives and subsidies to foreign and domestic investors.

“We would reassess and harmonize these laws to avoid redundant and overlapping incentives to cut revenue loss,” he said.

Drilon added that they are also studying options for the mining fiscal regime with the view of increasing the government’s share from mining revenues.

Lastly, Drilon said that the Senate is also open to discussing the proposed constitutional amendment which will allow Congress to formulate economic policies by legislative process. It will also act on the Customs Modernization and Tariff Act to address smuggling and simplify customs procedures for ordinary citizens.